Government Agencies
Government agencies are quasi-government entities that issue debt in order to fund the government-sponsored provision of specific public goods or services based on sovereign or local law.
Local and Regional Government Authorities
Non-sovereign government authorities may either issue debt for general purposes, which is repaid from local tax cash flows, or issue debt to fund specific projects or infrastructure, which is repaid from user fees or other cash flows directly derived from the project. The former are referred to as general obligation bonds (GO bonds), which are used to fund public goods and services in the non-sovereign’s limited jurisdiction, such as the Province of Ontario green bond issue described in the term sheet below.
Revenue bonds, in contrast, are issued for specific project financing (infrastructure such as roads, bridges, or tunnels) with the source of repayment often linked to a project’s revenue stream (tolls, fees, etc.). Revenue bonds usually involve longer-dated funding, the maturity of which often matches the expected life of matching project cash flows.
Supranational Organizations
Supranational issuers target bond investors in major currencies using global bond markets. In the example bond issue below, the Asian Development Bank borrowed in Indonesian rupiah (IDR) but will pay interest and principal to investors in US dollars.
